146

Reddit co-founder’s VC fund to invest $177 million into crypto sector as ‘everything is on sale’

Justinas
Baltrusaitis
1 month ago
2 mins read

Seven Seven Six, the venture capital (VC) firm by Reddit co-founder Alexis Ohanian is planning to make its first direct entry into the crypto space, aiming to raise a $177.6 million fund. 

The fund dubbed, ‘Kryptós’ will focus on investing in cryptocurrencies while citing the ongoing market volatility as a perfect opportunity to enter the sector, The Information reported on August 29. 

According to the VC firm, the Kryptós fund will primarily invest in cryptocurrencies that trade at more affordable rates following the slump in market prices. 

“This is the best time to buy if you’re really long on the industry. It’s on sale. Everything is on sale,” said Katelin Holloway, Founding Partner at Seven Seven Six. 

The entry into digital assets follows Seven Seven Six’s April registration as an investment adviser allowing it to invest in cryptocurrencies. 

Investors to earn 25% carried interest  

As per funding material, investors in the fund will be charged a 2.5% management fee making them eligible to earn 25% in carried interest. Notably, the returns will potentially surge to 35% if Kryptós manages to record fivefold returns or more.

The VC firm’s entrance into crypto amid collapsing prices indicates the company is betting on the market to rally in the future. In line with this outlook, several, several crypto analysts maintain the prevailing market conditions are temporary and part of the growth trajectory. 

Overall, it’s unclear how the ongoing market conditions will impact VC funding in crypto and blockchain companies. However, as reported by Finbold, investments in blockchain startups spiked over 600% in 2021, hitting $14.8 billion. 

At the same time, established firms like Alphabet have emerged as leading entities betting on the crypto sector. 

Ohanian’s crypto inroads 

It is worth mentioning that this is not the first time Ohanian has been involved in crypto since Reddit has made several inroads into the sector. For instance, the social media platform unveiled an avatar marketplace as part of its venture into the non-fungible token (NFTs). 

Through the feature, users can buy blockchain-based profile pictures at a fixed price through credit cards, eliminating the need for owning cryptocurrencies.  Furthermore, Reddit has partnered with crypto exchange FTX to integrate its Community Points across different global markets.

Latest News

Join us on Twitter or Telegram

Or follow us on Flipboard Flipboard

Like the article? Vote up or share on your social media

Weekly Finance Digest

By subscribing you agree with Finbold T&C’s

Justinas Baltrusaitis
Author

Justin crafts insightful data-driven stories on finance, banking, and digital assets. His reports were cited by many influential outlets globally like Forbes, Financial Times, CNBC, Bloomberg, Business Insider, Nasdaq.com, Investing.com, Reuters, among others.

AD